Laura Sharman 11 October 2019

Hike in PWLB rate will cost councils £70m a year

The 1% increase to the Public Works Loan Board (PWLB) rate will cost councils £70m a year, town hall chiefs have warned.

In a letter to chief finance officers, the Treasury hiked the interest rate charged on loans to local authorities by one percent, taking the interest rate from 1.8% to 2.8% with immediate effect.

The Local Government Association (LGA) warned the increase will significantly increase the cost of borrowing for councils and put capital schemes at risk.

A spokesperson for the LGA said: 'This 1 per cent PWLB rate increase could cost councils an extra £70 million a year for borrowing to be undertaken in the next year.

'It presents a real risk that capital schemes, including vital council house building projects, will cease to be affordable and may have to be cancelled as a result.'

Regeneration company Be First called the decision 'dysfunctional' and warned it will hit public housing projects hard.

Managing director Pat Hayes said: 'It’s a dysfunctional decision by the Johnson led Government - it looks like the left hand doesn’t know what the right hand is doing.

'Boris Johnson promised to put ‘rocket boosters’ under the economy to boost economic growth in preparation for Brexit. But the reality is that the Treasury is choking off funding for badly needed housing and public infrastructure projects.'

Visit The MJ (£) for more on this story.

SIGN UP
For your free daily news bulletin
Highways jobs

Residential Assistant

Essex County Council
£25081.00 - £25395.00 per annum
Residential AssistantPermanent, Full Time£25,081 up to £25,395 per annumLocation
Recuriter: Essex County Council

Senior Planning Officer

Durham County Council
Grade 11 £39,513 to £43,693 Grade 12 £42,708 to £46,731 per annum (Pay Award Pending)
Durham County Council is looking for experienced and knowledgeable Senior Planning Officers to join our vibrant Development Management team. Our team Durham
Recuriter: Durham County Council

Head of Service – Social Care

Wrexham County Borough Council
G15 £63,148 - £67,058 per annum
There is an exciting opportunity within Children Social Care to join the senior management team Wrexham (Wrecsam)
Recuriter: Wrexham County Borough Council

Head of Service Social Work & Specialist Support

Blackburn with Darwen Borough Council
Grade M scp 60 £72,118 - scp 64 £77,293
There couldn’t be a more exciting time to join us. Blackburn, Lancashire
Recuriter: Blackburn with Darwen Borough Council

Cafe Assistant - Weald Country Park

Essex County Council
Up to £13.3000 per hour
Café Assistant (Weald Country Park)Contract
Recuriter: Essex County Council
Linkedin Banner